The axe hangs over hundreds of mining jobs today, with state-owned Solid Energy poised to reveal the fate of two of its mines as it moves to slash costs.

It is understood the Spring Creek Mine on the West Coast and Huntly East, which together employ more than 400 staff, will be the worst affected, though there could be cuts elsewhere.

The company will announce its full-year result on Friday, and it has already warned its revenues were down $200 million.

Solid Energy spokeswoman Vicki Blyth said staff would be told at meetings today, but she would not confirm or deny job losses.

However, she said rumours of 40 redundancies at the company's Stockton Mine, also on the West Coast, may have been sparked by a contractor completing a job early, which could lead to job losses.

Grey District Mayor Tony Kokshoorn said Solid Energy chief executive Don Elder had called him on Sunday to alert him, but details of his plans remained closely guarded. He had outlined options "from the status quo to finish up and never go back".

Mr Kokshoorn said the worst scenario was if the company laid off all its contractors.

"The best is business as usual, but I don't see that happening."

He did not expect full mine closures, because the company would then have to hand back its valuable licences.

Spring Creek is costing $5m a month and is still in the development phase with no mining, though it is ready to come on stream in six months.

Mr Kokshoorn said he was appealing to the company not to make a knee-jerk reaction to a cyclical downturn in coal prices.

"Think about this hard. Your intellectual property is your miners, who can easily get a job elsewhere. So hang in there and wait," he said.

West Coast Tasman MP Damien O'Connor said the news was "alarming and disturbing for the West Coast given the amount of hype from Solid Energy and investment in the past year. This is a rapid about-turn".

Last week Finance Minister Bill English said Solid Energy, one of the five state-owned companies slated for partial sale, was not in shape for a sell-down and was at the back of the queue for sale.

Dr Elder said the company was reviewing its business in response to extremely challenging market conditions, including falling demand, lower coal prices and the high New Zealand dollar.